Indian group Hero is to buy Honda Motor's 26 percent stake in their motorcycle venture Hero Honda Motors, paving the way for the Japanese company to focus on its wholly-owned Indian unit. The companies did not disclose financial details of the deal on Thursday. Honda's stake in Hero Honda, formed in 1984, has a market value of nearly $2 billion.
Hero Honda, which makes the CD range of bikes, Splendour, Glamour and Pleasure scooters, is India's largest motorcycle manufacturer, with more than half the domestic market. Selling out of the venture gives Honda the freedom to go it alone in the world's second-largest market for two-wheelers, where it is building its second wholly-owned motorcycle plant.
The Hero Group, for its part, hopes to explore new products and export opportunities now it has been released from a ban on exporting to markets where Honda has a presence. "We can now capitalise on diverse market opportunities including large export markets and new product categories and segments," Hero Honda chief executive Pawan Munjal told reporters in New Delhi.
Comments
Comments are closed.